After a Devaluation, All Other Things Equal, Exports Will Likely

question 372

Multiple Choice

After a devaluation, all other things equal, exports will likely _____ and imports will likely _____.

• A) increase; increase
• B) decrease; decrease
• C) increase; decrease
• D) decrease; increase

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Definitions:

Straight-Line Method

This is a method of allocating the cost of an asset evenly over its useful life.

Depreciation Expense

Expense allocated for the reduction in value of tangible assets over their useful life for accounting and tax purposes.

Estimated Residual Value

The anticipated value of an asset at the end of its useful life.

Obsolescence

The process through which a product or technology becomes outdated and no longer used, often due to advancements or changes in consumer preferences.